Household liabilities rise to 6.4% of GDP in FY24

THE COUNTRY'S ECONOMIC growth trajectory will likely pick up in the second half of the current financial year, driven by domestic private consumption and a sustained revival of rural demand, the Reserve Bank of India (RBI) said in its monthly bulletin released on Tuesday.

- FE BUREAU

"High-frequency indicators for the third quarter of 2024-25 indicate that the Indian economy is recovering from the slowdown in momentum witnessed in Q2, driven by strong festival activity and a sustained upswing in rural demand," the central bank said in an article titled 'State of the Economy'.

Also, the prospects for agriculture and rural consumption are looking up due to "brisk" expansion of rabi sowing, it said.

The gross domestic product (GDP) rose by 5.4% in July-September on-year, the lowest in seven quarters, as weaker expansions in manufacturing and consumption hurt the economy.

Some analysts feared that FY25 growth may come in below 6.5% as against the Economic Survey projection of 6.5-7%. In its monetary policy review earlier this month, the RBI has sharply cut its growth forecast for FY25 to 6.6% from 7.2%.

If inflation is allowed to run unchecked, it can undermine the prospects of the real economy, especially industry and exports, the RBI said.